TMI Blog2020 (5) TMI 573X X X X Extracts X X X X X X X X Extracts X X X X ..... received as ingenuine and unexplained - bank statements submitted of these parties showing transactions were either unreadable or incomplete or were not submitted at all - HELD THAT:- Since the assessee has demonstrated before us that the bank statements of all the loan givers was filed to the revenue authorities and is therefore, available, we consider it fit to restore the issue back to the A.O. to consider the bank statements of all the loan depositors alongwith other evidences filed and adjudicate the issue afresh thereafter in accordance with law. Accordingly, ground of the appeal are allowed for statistical purposes only. - ITA No. 1569/Chd/2018 - - - Dated:- 28-2-2020 - Shri Sanjay Garg, Judicial Member And Smt. Annapurna Gupta, Accountant Member For the Assessee : Shri Parikshit Aggarwal, CA For the Revenue : Shri Arvind Sudarshan, JCIT-DR ORDER PER: ANNAPURNA GUPTA, ACCOUNTANT MEMBER: The present appeal has been filed by the assessee against the order passed by the ld. Commissioner of Income Tax (Appeals)-I, Ludhiana [in short CIT(A)] dated 22/10/2018, U/s 250(6) of the Income Tax Act, 1961 (hereinafter referred to as the Act) for the A.Y. 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his order, whereas identity, creditworthiness and genuineness of the creditors proved by the assessee before the learned Commissioner of Income Tax (Appeals)- 1, Ludhiana as well as before the learned Assessing Officer. Therefore, addition of ₹ 1,00,83,240/- made by the learned Assessing Officer and confirmed by the learned Commissioner of Income Tax (Appeals)-1, Ludhiana is illegal, uncalled for unwarranted and needs to be deleted. 5. That the appellant craves to leave or to amend the ground of appeals before or at the time of hearing. 2. Ld.Counsel for the assessee took up Grounds No. 1 and 2 of the appeal together, pointing out that they related to the same issue of disallowance of interest expenses made U/s 36(1)(iii) of the Act vis a vis debit balance in the account of the partners of the assessee firm, and on loan advanced respectively and stated that his arguments against both the disallowances was the same. 3. Drawing our attention to the facts of the case, the ld. counsel for the assessee pointed out that the assessee being a partnership firm had paid interest on debit balance in the capital account of two partners Shri K.K. Chadha and Shri Sumesh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thod adopted by the A.O. was incorrect and as factually pointed out the assessee had paid interest at lower rate as compared to that charged on the debit balance of the partner s capital account and the advances made. He therefore pleaded that there was no reason for making any disallowance of interest U/s 36(1)(iii) of the Act. 5. The ld DR, though was unable to controvert the factual contentions of the assessee, however, relied on the order of the CIT(A). 6. We have heard the rival contentions and have gone through the orders of the authorities below and also the documents to which our attention was drawn. We find merit in the contention of the ld. counsel for the assessee that the facts of the case occasion no disallowance of interest U/s 36(1)(iii) of the Act. In the facts of the present case, as pointed out by the ld counsel for the assessee, the assessee we find has paid interest on unsecured loans during the impugned year at an average rate of 10% which is demonstrated from the facts and figures of unsecured loan and interest paid thereon reflected in the financial statements of the assessee which are duly audited. This fact ,the revenue has been unable to controvert b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 30,99,000/- 06 Nidhi Sachdeva 10,00,000/- 42,000/- 3,000/- 10,45,000/- Total 1,00,83,240/- 07 Bindu Khemka 5,00,000/- 84,000/- 6,000/- 5,90,000/- The ld. counsel for the assessee drew our attention to the assessment order and pointed out that the A.O. had made the impugned addition for the reason that the summons issued to the said party had remained unserved and the assessee had not been able to produce them before the A.O. and in some cases, the assessee had not submitted even the copy of income tax returns or the PAN details and the bank details of these parties. The A.O., therefore, had held that the assessee had not been able to prove the identity of the givers of unsecured loans and also the genuineness and creditworthiness of the givers and accordingly had made the addition U/s 68 of the Act. The ld. Counsel for the assessee pointed out that before the ld. CIT(A), the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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